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TransAlta and MidAmerican Create New Partnership to Develop and Build Natural Gas-Fueled Power Projects in Canada

CALGARY, ALBERTA--(Marketwire - Oct. 26, 2012) - TransAlta Corporation (TSX:TA)(NYSE: TAC) and MidAmerican Energy Holdings Company announced today the creation of a new strategic partnership through which the two companies will work together to develop, build and operate new natural gas-fueled electricity generation projects in Canada.

This partnership builds on an existing successful relationship. The extensive power development and operating experience of both companies, combined with TransAlta's deep knowledge of the Canadian markets and MidAmerican's financial strength, is expected to accelerate gas-fueled power development for both partners.

"The creation of this partnership is a new and exciting development in our growth strategy and better positions the two companies to pursue significant growth opportunities in Canada," said Dawn Farrell, TransAlta president and CEO. "Studies are showing that more than $200 billion worth of new investment in power generation is needed in Canada over the next 20 years. MidAmerican is a strong partner to enable us to capture a sizeable share of that market opportunity, and this project will build off our already existing business relationship, which dates back to 2001."

"At MidAmerican, we have been seeking an entry point to the Canadian electricity generation market, where we see strong potential for growth," said Greg Abel, chairman, president and CEO of MidAmerican. "We are joining forces with a company that has more than 100 years of history and a well- established reputation for building and operating excellent power projects. Our two companies also have similar cultures and a shared commitment to safe, reliable operations. The partnership will bring two strong development teams together to deliver clean, highly efficient power to the region."

The agreement encompasses all new natural gas-fueled generation opportunities considered by either TransAlta or MidAmerican in Canada, including TransAlta's proposed Sundance 7 project, an up to 800-megawatt project based in Alberta, Canada. All development and construction or acquisition of approved projects will be funded on a 50-50 basis, and TransAlta will be responsible for construction management, operation and maintenance of projects that proceed.

About the Partners:

An alliance and partnership already exists between TransAlta and MidAmerican through CE Generation, LLC, a limited company in which membership interests are equally owned by MidAmerican and TransAlta Investments USA Inc.

TransAlta is a power generation and wholesale marketing company focused on creating long-term shareholder value. TransAlta maintains a low-to-moderate risk profile by operating a highly contracted portfolio of assets in Canada, the U.S. and Australia. TransAlta's focus is to efficiently operate geothermal, wind, hydro, natural gas and coal facilities in order to provide customers with a reliable, low-cost source of power. For 100 years, TransAlta has been a responsible operator and a proud contributor to the communities in which it works and lives. TransAlta is recognized for its leadership on sustainability by the Dow Jones Sustainability North America Index, the FTSE4Good Index and the Jantzi Social Index. TransAlta is Canada's largest investor-owned renewable energy provider. Information about TransAlta is available at www.transalta.com.

MidAmerican Energy Holdings Company, based in Des Moines, Iowa, is a global provider of energy services. Through its energy-related businesses, MidAmerican provides electric and natural gas service to more than 6.9 million customers worldwide. These businesses are Pacific Power, Rocky Mountain Power and PacifiCorp Energy, comprising PacifiCorp; MidAmerican Energy Company; Northern Powergrid Holdings Company; Northern Natural Gas Company; Kern River Gas Transmission Company; MidAmerican Renewables; and CalEnergy Philippines. Information about MidAmerican is available at www.midamerican.com.